What comes after the 401k and IRA?

If you have maxed out the 401k Match and you have Maxed out your IRA for the year.

Next you should have an Individual Taxable Account from TD Ameritrade for Saving and Investing. This should be your emergency fund. The Goal of this account is to get 6-9 months of your current income saved. This will only be used in the event you get hurt, or get fired. You would have 6-9 Months to find a job (Without tapping into your Retirement Savings) The higher income you have typically the longer it takes to find a comparable job.

• This account can be added to and withdrawn at will, with no penalties at all. The only taxes you pay are those on interest, dividends and gains from your investing.
• Also This account can have debit and check features
• Also after  you have save the 6-9 months, everything saved after that should be used for saving and investing for large ticket purchases such as a house. :)
• Also it would probably be smart for you to carry some disability insurance (You are 70% more likely to be disabled than to die before the age of 75) This way if you got into an accident that kept you from working, the Disability insurance will kick in and pay you an income if you can't work. 

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401k? Traditional IRA? Whats the Freakin Difference!

I remember what is was like when I use to get so confused over all of the different IRA options that are out there.

I went to work, worked real hard, worked lots of hours, saved my money, and then had no clue where to put it. I mean I didn't want to loose my money, that didn't make sense.

So many advisers and so many different advices. I decided to figure it out on my own once and for all and be done with it. I learned so much about retirement investment options and vehicles. Often we get so caught up in the detail that we forget the general road map. I don't know about you but I know that I'm guilty of this.

So the first thing to do is have a general road map, Whats that saying "Keep It Simple Stupid" KISS

So here is a quick breakdown of the pro's and cons of the Traditional IRA versus the 401K. And we'll leave the Roth IRA for another day.


There are advantages to both


Advantages of 401k

• Most companies offer a match  (Free Money)
• Tax Advantages

Disadvantages of 401k

• Very Very limited options , can be hard to make money at times

Advantages of a Traditional IRA

• More Investment Options
• Easier to make money
• Tax Advantages

Disadvantages of a Traditional IRA

• No Employer Match 

Here is the bottom line - Max out the employer match on the 401k. So if your company matches up to 6% only invest up to 6%. To get the match

Any savings beyond that need to be put into an IRA .

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